Wrapped XRP is a token pegged to XRP that can be used on blockchains other than XRP Ledger. The wrapped asset is exchangeable 1:1 with XRP held in reserve by a custodian that facilitates wrapping XRP and unwrapping wrapped XRP.
The price of wrapped XRP is pegged to XRP due to arbitrage. When the price of wrapped XRP is higher, traders wrap the cheaper XRP and then sell wXRP, lowering its price. When the price of wrapped XRP is lower, traders buy and unwrap wXRP and sell XRP, increasing wXRP’s price. This creates a steady peg between the two tokens.
Wrapping XRP allows you to use the DApp ecosystem of a different blockchain and diversify your portfolio on that chain. If you want to get started, you can purchase Wrapped.com’s ERC-20 Wrapped XRP (wXRP) via Binance. The reserves of wXRP are managed by the licensed custodian Hex Trust, and you can begin wrapping XRP by signing up for an account with Wrapped. You can use wXRP to stake in liquidity pools by providing it in a token pair on platforms including Uniswap and Sushiswap.
A typical cryptocurrency portfolio is likely to have coins and tokens across multiple blockchains. However, managing and investing all these assets can be tricky, especially when blockchains aren’t interoperable. One way to overcome this is by using wrapped tokens to bridge coins from one chain to another. While wrapped versions of Bitcoin (BTC) and Ether (ETH) are already familiar sights on Decentralized Finance (DeFi) platforms and exchanges, we now have a new wrapped asset to work with: Wrapped XRP (wXRP).
What is wrapped XRP?
How does wrapped XRP work?
Why do we need to wrap XRP?
Wrapping XRP provides several advantages for both XRP holders and users on the target blockchain:
Who are Wrapped, and what is Wrapped XRP (wXRP)?
Wrapped already manages a basket of wrapped tokens and has offered ERC-20 Wrapped XRP on Ethereum since December 2021. wXRP’s reserves are held by Hex Trust, a licensed and insured custodian in Asia, and you can easily trade the token on Binance.
How to wrap XRP and unwrap wXRP?
Which DeFi apps can I use wXRP with?
Wrapping tokens is an excellent step in improving cross-chain functionality and interoperability. If you’re an Ethereum DeFi fan, you now have the chance to experiment with holding and investing in XRP. If you’re an XRP holder, there’s a huge amount of opportunities to explore now that you have access to the Ethereum ecosystem. No matter which group you belong to, make sure to use a trusted wrapped token that is auditable.